Match!

Reconceptualizing the Firm in a World of Outsourcing and Offshoring: The Organizational and Geographical Relocation of High-Value Company Functions

Published on Dec 1, 2010in Journal of Management Studies5.839
· DOI :10.1111/j.1467-6486.2010.00945.x
Farok J. Contractor27
Estimated H-index: 27
(RU: Rutgers University),
Vikas Kumar29
Estimated H-index: 29
(USYD: University of Sydney)
+ 1 AuthorsTorben Pedersen45
Estimated H-index: 45
(CBS: Copenhagen Business School)
Sources
Abstract
In the largest sense, global strategy amounts to (1) the optimal disaggregation or slicing of the firm's value chain into as many constituent pieces as organizationally and economically feasible, followed by (2) decisions as how each slice should be allocated geographically (‘offshoring’) and organizationally (‘outsourcing’). Offshoring and outsourcing are treated as strategies that need to be simultaneously analysed, where just ‘core’ segments of the value chain are retained in-house, while others are optimally dispersed geographically, as well as dispersed over allies and contractors. This amounts to a reconsideration of the nature of the firm that captures the dynamic changes in global configuration and a reconsideration of what constitutes ‘core’ activities that need to be retained internally. The article proposes a new research agenda that searches for each firm's optimal degree of disaggregation and global dispersion given that further scattering of value chain activities entail benefits as well as increased complexity and costs.
  • References (52)
  • Citations (334)
📖 Papers frequently viewed together
251 Citations
193 Citations
114 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
References52
Newest
#1John H. DunningH-Index: 64
#2Sarianna M. LundanH-Index: 15
This is the second edition of the celebrated volume by Professor John H. Dunning, first published in 1993, which has now been not only updated but also enriched with the addition of a number of new topics. This addition was not least due to the expertise of the co-author, Sarianna Lundan, in the institutional aspects of international business and the internal governance of transnational corporations (TNCs). It is a comprehensive synthesis of all the theories in International Business based on ex...
4,241 CitationsSource
5 CitationsSource
#1Yuan Li (SJTU: Shanghai Jiao Tong University)H-Index: 34
#2Zelong Wei (Xi'an Jiaotong University)H-Index: 11
Last. Yi Liu (SJTU: Shanghai Jiao Tong University)H-Index: 28
view all 3 authors...
From the perspective of the vendors in emerging countries (VECs), this article investigates how the vendor firms in China respond to cross-border outsourcing trends differently by examining the different effects of entrepreneurial orientation (EO) and market orientation (MO), as well as their interaction, on local vendors' acquisition of knowledge from foreign outsourcers in cross-border outsourcing. We find that the knowledge acquisition of the vendors positively affects firm performance. Thus,...
89 CitationsSource
#1Mehmet Demirbag (University of Sheffield)H-Index: 27
#2Keith W. Glaister (University of Sheffield)H-Index: 32
This paper examines empirically the determinants of offshore location choice between country clusters. Based on a dataset of 1722 R&D projects by MNEs located in developed and emerging countries, we examine the impact of home and host country, industry, and firm level variables on choice of location. We draw on the extended OLI paradigm to develop our hypotheses. Using the EU15 as a base group, a multinomial logit model is estimated between the regions of USA&Canada, Eastern Europe&Russia, emerg...
146 CitationsSource
#1Susan M. Mudambi (TU: Temple University)H-Index: 18
#2Stephen Tallman (UR: University of Richmond)H-Index: 26
Outsourcing knowledge and innovation activities offer cost savings and superior performance, but can also put a firm's unique resources and capabilities at risk. Characterizations of outsourcing as a make-or-buy decision do not fit well with decisions on knowledge process outsourcing (KPO). KPO is a make-or-ally decision, as firms seek a governance structure that will both protect and leverage their strategic knowledge assets, with the final decision often coming down to a choice between differe...
165 CitationsSource
#1Christoph GrimpeH-Index: 17
#2Ulrich Kaiser (UZH: University of Zurich)H-Index: 19
The outsourcing of research and development (R&D) activities has frequently been characterized as an important instrument to acquire external technological knowledge that is subsequently integrated into a firm's own knowledge base. However, in this paper we argue that these ‘gains’ from R&D outsourcing need to be balanced against the ‘pains’ that stem from a dilution of firm-specific resources, the deterioration of integrative capabilities and the high demands on management attention. Based on a...
295 CitationsSource
#1Ram Mudambi (TU: Temple University)H-Index: 44
#2Markus Venzin (Bocconi University)H-Index: 9
193 CitationsSource
#1Pooja ThakurH-Index: 1
A Dissertation submitted to the Graduate School – Newark Rutgers, The State University of New Jersey in partial fulfillment of the requirements for the degree of Doctor of Philosophy Ph.D. in Management Written under the direction of Prof. Farok Contractor And approved by _______________________________ _______________________________ _______________________________ _______________________________
6 CitationsSource
#1Sébastien Miroudot (OECD: Organisation for Economic Co-operation and Development)H-Index: 18
#2Rainer Lanz (OECD: Organisation for Economic Co-operation and Development)H-Index: 6
Last. Alexandros Ragoussis (OECD: Organisation for Economic Co-operation and Development)H-Index: 4
view all 3 authors...
This study analyses trade flows in intermediate goods and services among OECD countries and with their main trading partners. Combining trade data and input-output tables, bilateral trade in intermediate goods and services is estimated according to the industry of origin and the using industry for the period 1995-2005. Trade in intermediate inputs takes place mostly among developed countries and represents respectively 56% and 73% of overall trade flows in goods and services. Gravity regressions...
155 CitationsSource
#1Arie Y. Lewin (Duke University)H-Index: 40
#2Silvia Massini (University of Manchester)H-Index: 17
Last. Carine Peeters (ULB: Université libre de Bruxelles)H-Index: 13
view all 3 authors...
This paper empirically studies the determinants of firms’ decision to offshore product development activities (i.e. R&D, product design and engineering services). A logit model is estimated using survey data from the Offshoring Research Network on offshore implementations initiated by US firms between 1990 and 2006. It relates the probability of offshoring product development to differences in companies’ strategic objectives (managerial intentionality), past experience (path dependence), and in ...
527 CitationsSource
Cited By334
Newest
#1Fabian Duffner (WWU: University of Münster)
#2Oliver Kratzig (WWU: University of Münster)H-Index: 1
Last. Jens Leker (WWU: University of Münster)H-Index: 15
view all 3 authors...
Abstract The selection of an optimal location for manufacturing plants is a topic of high strategic interest, as their construction is associated with a significant amount of irreversible capital and a substantial number of new job opportunities can be created in that region. Currently, the site selection of such plants is being intensely discussed in politics and industry in the context of battery cell production. Driven by an increase in battery demand, numerous new battery manufacturing plant...
Source
#1Carol Flinchbaugh (NMSU: New Mexico State University)H-Index: 3
#2Ghadir Ishqaidef (CSU Chico: California State University, Chico)H-Index: 3
Last. Clint Chadwick (KU: University of Kansas)H-Index: 13
view all 3 authors...
Source
#1Farok J. Contractor (RU: Rutgers University)H-Index: 27
#2Ramesh Dangol (YSU: Youngstown State University)H-Index: 1
Last. S. Raghunath (IIMB: Indian Institute of Management Bangalore)H-Index: 1
view all 4 authors...
Abstract How do multinationals choose which countries to invest in? This study addresses the essential question of the impact of regulatory variables in attracting or deterring foreign direct investment (FDI). We separate regulatory variables based on different stages of a firm’s life-cycle. Using World Bank data for 189 economies, we examine which host country regulatory factors influence inward FDI. We find that countries with stronger contract enforcement and more efficient international trad...
1 CitationsSource
Abstract Marketing outsourcing has been increasing for decades due to its well-known benefits, even though the development of dynamic marketing capabilities can be severely damaged as a result. This study focuses on the conditions under which marketing outsourcing favors organizational learning. We found that the relationship between marketing outsourcing and second-order marketing competences resembles an inverted U curve. The first-order marketing competences and absorptive capacity positively...
Source
Der Beitrag diskutiert die Notwendigkeit einer transnationalen Perspektive auf (Lohn-)Arbeit als feministisches Anliegen. In kritischem Anschluss an Konzepte von Michael Burawoy wird argumentiert, dass eine transnationale Perspektive den Blick offnet auf die permanente Rekonfiguration von hegemonialen und despotischen Arbeitsregimes und damit auf eine Logik sozialraumlicher Fragmentierung von Arbeit und Produktion, die einzelne Nationalstaaten gleichermasen ubergreift wie sie sie durchschneidet....
Source
#1Andreas Wieland (CBS: Copenhagen Business School)H-Index: 12
#2Lydia Bals (CBS: Copenhagen Business School)H-Index: 14
Last. Robert B. Handfield (NCSU: North Carolina State University)H-Index: 57
view all 4 authors...
Abstract This article reviews existing work on global sourcing and suggests a number of new theoretical directions for research in this area. We discuss how international business (IB) and supply chain management (SCM) research can benefit from increased cross-fertilization of themes and perspectives. We begin by introducing a taxonomy of global sourcing research, building on relevant insights from SCM research. We then generate recommendations for potential future research on global sourcing, p...
Source
Source
In current debates on precarization in Europe, a transnational and more class-based perspective is demanded. While fully supporting this request, this article nevertheless notices that, often, when...
Source
ABSTRACTIn this paper, I (re)define outsourcing in a way that reflects the nature of the practice in education. While business and management definitions of outsourcing have been generative to this...
Source
#1Pooja Thakur-Wernz (WSU: Wichita State University)
#2Olga Bruyaka (WVU: West Virginia University)H-Index: 5
Last. Farok J. Contractor (RU: Rutgers University)H-Index: 27
view all 3 authors...
Abstract Given the complexity of sourcing choices in R&D, driven by conflicting points of difference, scholars have struggled to formulate clear theoretical predictions about which sourcing choices lead to superior performance. Our study contributes to the elucidation of this question by studying both the antecedents and performance consequences (project cost and duration) of alternative sourcing choices in the context of new product development, thus bridging two rarely intersecting streams of ...
1 CitationsSource